As retailers become more savvy at catching point-of-sale credit card fraud, identity thieves are flocking to the internet to commit their crimes.
Between the Black Friday holiday shopping weekend in 2015 and 2016, experts have seen a 20 percent increase in online retail credit fraud, according to research firm iovation. Many pundits see this as a natural reaction to the adoption of EMV card readers by many retailers, which makes it much harder for thieves to conduct fraud in stores, according to Claims Journal. But approximately one year after many retailers began implementing EMV chip card readers, it's clear hackers have found a new way to steal personal information.
"The shift from in-person card fraud to card-not-present fraud shows that cybercriminals are quick to shift the focus of their scams," Scott Waddell, iovation's chief technology officer, said in a statement. "Much like EMV became a major weapon for in-person merchants, new authentication approaches will be the antidote to curb this new trend."
It is estimated that online fraud will cost retailers $7.2 billion by the end of 2020, according to Aite Group, which conducted research with iovation.
In the meantime, retailers should still take steps to beef up their online security to help reduce the instances of fraud on their site as much as possible. Some easy changes retailers can make to how they process online transactions include limiting the number of attempts individuals have to input sensitive information or integrating 3-D secure technologies to help monitor suspicious online activity, according to Inc.
Looking to the future, retailers should also be thinking about how to protect against fraud from mobile transactions because shopping from a smartphone is becoming increasingly popular among consumers. According to iovation's analysis, 55 percent of sales from Black Friday to Cyber Monday in 2016 were made from a mobile phone or tablet.